Eight US solar panel manufacturers are flagging a circumvention of tariffs by Chinese firms in Ethiopia, following a surge in solar imports from the East African country to the United States.
On May 12, eight US solar panel manufacturers asked the Department of Commerce to open an investigation into the circumvention of countervailing duties by Chinese companies established in Ethiopia. According to Bloomberg, these firms would assemble modules in Ethiopia before re-exporting them to the United States, thus evading antidumping and countervailing duties imposed on direct imports from China. Solar is growing rapidly in the United States, where it is set to surpass coal in states like Texas by 2026, heightening the commercial stakes around equipment. US imports of solar products from Ethiopia, almost non-existent until June 2025, surged to around $300 million by the end of December, making the country the seventh-largest solar supplier to the United States.
This dynamic puts Ethiopia at the center of a two-front trade battle. Since December 2025, US Customs and Border Protection (CBP) has already rejected $16.3 million worth of Ethiopian solar equipment under the law banning imports of goods produced by forced labor, particularly those linked to the Chinese polysilicon supply chain. Tim Brightbill, an attorney at Wiley Rein and lead lawyer for the group of eight complainants, told Reuters: “The US solar industry is at a turning point; with billions invested, thousands of jobs created, and real capacity brought online, we will not let systematic tariff evasion compromise this progress.”
Benefiting from competitive labor costs and modern industrial parks, Addis Ababa is seeking to become an African hub for solar equipment manufacturing. Several Chinese groups have announced major projects there. According to China Global South, three consortiums – CSI Solar (a subsidiary of Canadian Solar), Hainan Drinda New Energy Technology, and Toyo Solar Manufacturing – plan to invest more than $500 million in module, cell, and energy storage factories in Ethiopia. Meanwhile, a plant called “Gobeze Solar Cell” has emerged in the Huajian special economic zone, with an initial investment of $100 million for its first phase.
This dispute is part of a broader confrontation between Beijing and Washington for control of renewable energy supply chains. China now dominates over 80% of global solar module production and a significant share of polysilicon. US tariffs on solar cells imported from China jumped from 25% to 50% in 2024 under Section 301 provisions. After antidumping and countervailing duty investigations that heavily penalized assembly hubs in Southeast Asia between 2024 and 2025, Chinese manufacturers turned to Ethiopia, a jurisdiction still free of such penalties. Solar trade tensions go beyond the bilateral framework, with Beijing also protesting the risk classification imposed by Brussels on solar inverters.
Economic modeling of the US solar market shows that a $1 import tax translates into an average $1.35 increase in the final consumer price, explaining the responsiveness of domestic producers to the surge in Ethiopian imports. For Ethiopia, the stakes are high: developing its solar sector offers a major industrial opportunity, but it also exposes it to geopolitical frictions between the world’s two largest economic powers.
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